Kyushu Electric Power Group’s overseas business company, Kyuden International, has acquired IHI Power Services Corp., a U.S. subsidiary of IHI that handles power plant maintenance. Behind this is the strategic alignment of Kyushu Electric Power’s efforts to strengthen its revenue base in the U.S. and IHI’s business restructuring efforts.

Kyushu Electric Power Becomes a Wholly Owned Subsidiary of IHI in the US

Kyushu Electric Power’s core company, Kyūden International, which oversees overseas operations, signed a share purchase agreement on March 16, 2026, to acquire all shares of IHI Power Services Corp. (hereinafter, IPSC), a consolidated subsidiary of IHI Corporation. This acquisition marks Kyushu Electric Power Group’s first entry into the operation and maintenance (O&M) business in the United States. The acquisition process proceeded smoothly, and after approval by the relevant authorities, the share transfer was completed on July 23, 2026.

Until now, Kyushu Electric Power has invested in multiple power generation projects in the United States, accumulating equity output, but this is the first time it has directly ventured into the O&M business, which handles operational operations. The following chart shows the extent of projects that the Kyuden Group is expanding overseas.

With this wholly owned subsidiary, Kyushu Electric Power aims to further advance its power generation business in the U.S. market, building a multi-layered revenue structure that includes not only returns from investments but also from technology fee income from service provision. Attention will be focused on how Japanese power companies will deploy their advanced maintenance and management technologies in the United States, one of the world’s largest energy consumers.

Launch of the new company, Kyuden Energy Partners

With the completion of the share transfer, the former IPSC changed its name to Kyuden Energy Partners Corporation effective July 23, 2026. The new company continues to be headquartered in Alisobiejo, California, USA, and is making a fresh start as part of the Kyuden Group. Kyushu Electric Power is committed to combining its extensive experience and know-how in power plant operations accumulated over many years in domestic operations with the specialized expertise that the former IPSC cultivated under the challenging market environment of the United States.

By creating this synergy, we aim to further enhance the corporate value of the new company and strengthen our business foundation in the United States. The new company will go beyond mere maintenance and management, providing comprehensive services including technical support, accelerating its position as a trusted partner for local power producers. The fact that we include ‘Energy Partner’ in our company name reflects our deep commitment to maximizing our customers’ business value, rather than just being a contractor.

Business scale of IHI Power Services targeted for acquisition

The former IPSC targeted for acquisition was established in 2012 and has over 10 years of proven track record in the U.S. market. As of the end of December 2025, the company will have approximately 550 employees and provide operation and maintenance services at power generation facilities across the United States. The company recorded sales of approximately $126.23 million (about 20 billion yen at the exchange rate at the time) for the fiscal year ending March 2025, giving it a significant presence in terms of business scale.

The company’s strength lies in possessing O&M expertise for a wide range of power sources, including thermal power plants and renewable energy facilities. He also has experience as an owner and operator of power generation facilities, and also provides consulting services for regulatory compliance and project management. By referring to the diagram below, you can understand what kind of management resource shifts IHI was considering.

By bringing under its umbrella a company that combines on-site capabilities as a group of engineers with management capabilities to comply with complex U.S. regulations, Kyushu Electric Power is well prepared to accelerate full-scale penetration into the U.S. market.

Strategic Choice: Jiudian’s Growth and IHI Reform

Kyushu Electric Power’s Overseas Business Expansion and Diversification of Revenue

The Kyushu Electric Power Group has set forth the “Kyushu Electric Power Group Management Vision 2035” as a medium- to long-term management strategy. This vision positions overseas business as one of the pillars of growth as the domestic electricity market matures. As of the end of March 2024, the company has participated in 26 projects in 16 countries and overseas power businesses, with a total investment generation capacity of 2.86 million kW.

The United States, in particular, is one of the company’s most important markets, and it has continued to invest in large-scale gas-fired power projects such as the Westmoreland power plant and Southfield Energy. However, until now, participation has mainly focused on dividend income from minority investments. The purpose of this acquisition is to bring the practical functions of O&M into our own group, thereby enabling the company to enjoy the following benefits.

• Deepening Knowledge by Directly Acquiring On-Site Operation Data of Power Plants

• Strengthening new project development capabilities based on operational management capabilities

• Earn stable fee income independent of investment returns

By shifting our business model from investment-driven to operational-involved model, we aim to balance revenue stability with growth potential.

IHI’s Business Structure Reform and Portfolio Restructuring

On the other hand, for IHI, the seller, this share transfer is an important part of the structural reform of its overseas carbon solutions business, which was announced in November 2025. IHI is currently conducting a fundamental review of its business portfolio based on its medium-term management plan, the “Group Management Policy 2023,” covering fiscal years 2023 through 2025.

In the company’s Resources, Energy, and Environment business area, it is urgent to move away from low-profit businesses such as existing coal-fired power generation and shift management resources toward growth areas such as ammonia fuel use. Although IPSC had been generating stable revenue in the United States, in light of IHI’s strategic focus on “decarbonization solutions,” it was determined that joining the Kyushu Electric Power Group, which is actively strengthening its energy business in North America, would be optimal for sustainable growth. IHI aims to enhance corporate value by reinvesting the funds and management resources obtained from this transfer into aircraft engines, defense businesses, and the development of cutting-edge green technologies such as hydrogen and ammonia.

Business Opportunities Created by Transformation of the U.S. Power Market

Challenges in Power Infrastructure Due to AI Demand and Renewable Energy Expansion

The current U.S. power market is undergoing unprecedented structural changes. The biggest factor behind this is the explosive growth in data centers accompanying the spread of generative AI. Data centers consume enormous amounts of electricity, raising concerns about power supply shortages in various regions. How to efficiently and continuously operate existing power generation facilities without interruption has become a matter of life and death.

At the same time, under the Biden administration, the introduction of renewable energy such as solar and wind power is rapidly advancing, but the increase in these variable sources is putting pressure on the stability of the transmission grid. To complement unstable renewables, the importance of thermal power plants as backups is being re-evaluated, leading to a surge in advanced maintenance demand aimed at extending the lifespan and improving efficiency of aging existing equipment. In such an environment, the value of technologies that “maintain” power plants has relatively increased, and the advanced technological capabilities of Kyushu Electric Power and the former IPSC align well with market needs.

Increasing demand for maintenance and operation services and securing specialized personnel

The expansion of the power plant O&M market in the United States also highlights the challenge of a severe shortage of specialized personnel. Operating power plants requires advanced expertise across a wide range of fields, from mechanical engineering to electrical control and compliance with environmental regulations, but due to the retirement of veteran engineers and a shortage of young workers, only a few operators can maintain high-quality maintenance systems in-house.

The fact that the former IPSC had about 550 specialized staff is an extremely significant asset for Kyushu Electric Power. Being able to inherit the team of on-site professionals cultivated over many years in the U.S. market is far less risky than starting a business from scratch, and allows for immediate deployment. As shown in the market forecasts below, investments in the protection and management of critical infrastructure are expected to continue growing steadily.

The Kyuden Group intends to differentiate itself by introducing the preventive maintenance philosophy of “fixing before it breaks” cultivated in Japan to the U.S. site, and by combining it with the skills of the new company’s engineers, we aim to provide high-quality O&M services that competitors cannot imitate, thereby differentiating ourselves.

Laying the Way for the Future and Global Competition

Toward Realizing Kyuden Group Management Vision 2035

Kyushu Electric Power positions this acquisition as a decisive step toward achieving the “Kyuden Group Management Vision 2035.” The vision aims for consolidated ordinary profit of over 200 billion yen by 2035, and within this goal, we have set an ambitious goal to raise the contribution of growth businesses, including overseas operations, to nearly 50%.

Especially in overseas operations, we are promoting strategies that enhance capital efficiency not only by expanding power generation capacity but also by asset recycling (asset replacement). By timely divesting low-profit projects and reinvesting in high value-added service businesses like IPSC and more promising renewable energy projects, we continuously optimize portfolio quality. This acquisition can truly be seen as a practical example of this “selection and concentration.” This will serve as a touchstone for transforming from a regional power company in Kyushu into a global company leading the world’s energy transition.

Risk Management in U.S. Investments and the Impact of CFIUS Reviews

When expanding business in the U.S., addressing geopolitical risks and regulations is an unavoidable avoidance. In recent years, the U.S. government has significantly strengthened the screening of foreign companies’ investments in critical infrastructure from a national security perspective. The scope of review by the Committee on Foreign Investment in the United States (CFIUS) is expanding, and energy infrastructure is at the core of that effort.

Although Japanese companies are in a relatively advantageous position as allies, there is still an increasing number of cases where detailed reports on technology transfer, cybersecurity measures, and supply chain transparency are being requested. For Kyushu Electric Power, making IPSC, which has a proven track record in the U.S., a subsidiary is an effective means to ensure local reliability and compliance capabilities. Amid intensifying competition with countries like China, building a robust governance framework based on increased oversight by U.S. authorities will be an absolute condition for further business expansion in the future. Building on the domestic management foundation gained through this acquisition, how to manage risk while sustaining growth will likely become a model case for future Japanese companies’ investments in the U.S.

Reference Page

• [Kyushu Electric Power Completes Share Transfer Related to the Acquisition of IHI Power Services Corp. in the United States https://www.kyuden.co.jp/press/2026/h260723-1.html

• [Kyushu Electric Power has signed a share purchase agreement for the acquisition of IHI Power Services Corp. in the United States https://www.kyuden.co.jp/press/2026/h260316-1.html

• [IHI FY2024 (Fiscal Year Ending March 2025) Financial Results Briefing – Business Overview]https://www.ihi.co.jp/ir/library/briefing/__icsFiles/afieldfile/2025/05/08/presentation_250508_1.pdf

• [Deloitte Tohmatsu CFIUS strengthens investment screening for U.S. investments, including Japanese companies]https://faportal.deloitte.jp/institute/report/articles/000854.html

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